What are the World’s top saving countries?
According to the World Bank National Accounts Data, Brunei has the highest gross national savings. The progressive policies and macroeconomic stability of the country, account for a high Gross Domestic Product, which further pushes the economy towards higher savings.
The income and savings are directly proportional. The Gross National Savings account for the income which remains from the Gross Domestic Product after the Final Consumption Expenditure (household sector, private-corporate sector and public sector). When these savings, formerly a leakage, are invested, act as injections driving towards economic growth.
Savings are considered necessary owing to the nature of future incomes being uncertain and for retirement purposes. An individual’s Personal Disposable Income is either invested or saved. Any advances in the economy swells the Personal Disposable Income which further boosts the Marginal Propensity to Save. This is also called the Multiplier Effect: the effect of income on savings.
The few determinants of savings are-:
- The Demographics of The Region.
A large number of dependent population leads to consumption requirement at the cost of savings. Thus, negatively affecting the rate of savings. - The Income Ratios.
The accumulation of income in the hands of few has led to the unequal savings rate in different regions. - Productivity of The Region.
An improvement in the productivity rates results in optimization and cost reduction. This positively affects the rate of savings. - Consumerism.
The availability of multiple opportunities for an individual to borrow, has stimulated to a process of debt creation leading to a decrease in saving rate. - Paradox of thrift.
The theory of paradox of thrift states that, people tend to save more during the financial crisis than when the economy is stable. It goes by the simple logic of fall in demand when the economy is in recession. - Others: The price difference between domestic and foreign goods, inflation rates.
Varying Gross Saving Rates in Countries-:
Two broad patterns are observed amongst the nations in terms of gross savings as percentage of the Gross Domestic Product. First, the countries with a relatively high gross savings are either ‘crude’ economies or the ’emerging economies’.
Economies like Brunei and Qatar depend on crude resource extraction and processing as the source for their economic wealth and national savings. Whereas in the case of emerging economies of the east, such as Macao, China and Nepal, the low regulatory costs, results in more savings.
On the lower end, the countries like Sierra Leone, Burundi, Zimbabwe and Guinea, with a negative number, depicts the economy is spending more than the income being produced. This process of dissaving eventually makes a country low on national wealth creation.
Underlying is the table depicting the varying gross savings rates (percentage of the GDP) amongst the nations-:
| Country | Gross savings (% of GDP) |
Years | Country | Gross savings (% of GDP) |
Years | |
| Brunei Darussalam | 56 | 2016 | Slovakia | 22 | 2017 | |
| Macao | 49 | 2016 | Jamaica | 21 | 2016 | |
| Singapore | 48 | 2017 | Chile | 21 | 2017 | |
| Suriname | 48 | 2017 | Dominican Republic | 21 | 2017 | |
| China | 47 | 2017 | Honduras | 21 | 2017 | |
| Nepal | 44 | 2017 | Latvia | 21 | 2017 | |
| Philippines | 44 | 2017 | Romania | 21 | 2017 | |
| Botswana | 40 | 2016 | Cote d’Ivoire | 20 | 2016 | |
| Haiti | 40 | 2016 | Canada | 20 | 2017 | |
| Qatar | 40 | 2016 | Italy | 20 | 2017 | |
| Mauritania | 38 | 2017 | Pakistan | 20 | 2017 | |
| Algeria | 37 | 2016 | Peru | 20 | 2017 | |
| Ireland | 37 | 2017 | Poland | 20 | 2017 | |
| Korea, Rep. | 36 | 2017 | Uganda | 20 | 2017 | |
| Bangladesh | 35 | 2017 | Ukraine | 20 | 2017 | |
| Norway | 34 | 2017 | Burkina Faso | 19 | 2016 | |
| Sri Lanka | 34 | 2017 | New Zealand | 19 | 2016 | |
| Switzerland | 34 | 2017 | Timor-Leste | 19 | 2017 | |
| Malta | 33 | 2016 | Afghanistan | 18 | 2016 | |
| Tajikistan | 33 | 2016 | Niger | 18 | 2016 | |
| India | 32 | 2017 | United States | 18 | 2016 | |
| Zambia | 31 | 2016 | Armenia | 18 | 2017 | |
| Indonesia | 31 | 2017 | Colombia | 18 | 2017 | |
| Macedonia | 31 | 2017 | Lithuania | 18 | 2017 | |
| Ethiopia | 30 | 2016 | Cambodia | 17 | 2016 | |
| Guyana | 30 | 2016 | Laos | 17 | 2016 | |
| Myanmar | 30 | 2016 | Albania | 17 | 2017 | |
| Thailand | 30 | 2016 | Cameroon | 16 | 2016 | |
| Kyrgyzstan | 30 | 2017 | Fiji | 16 | 2016 | |
| Netherlands | 30 | 2017 | Nigeria | 16 | 2016 | |
| Sweden | 30 | 2017 | Bolivia | 16 | 2017 | |
| Belarus | 29 | 2017 | Bosnia and Herzegovina | 16 | 2017 | |
| Denmark | 29 | 2017 | Namibia | 16 | 2017 | |
| Malaysia | 29 | 2017 | Paraguay | 16 | 2017 | |
| Austria | 28 | 2017 | Portugal | 16 | 2017 | |
| Azerbaijan | 28 | 2017 | South Africa | 16 | 2017 | |
| Germany | 28 | 2017 | Uruguay | 16 | 2017 | |
| Morocco | 28 | 2017 | Gambia | 15 | 2016 | |
| Japan | 27 | 2016 | Swaziland | 15 | 2016 | |
| Saudi Arabia | 27 | 2016 | Brazil | 15 | 2017 | |
| Bulgaria | 27 | 2017 | Moldova | 15 | 2017 | |
| Czech Republic | 27 | 2017 | Serbia | 15 | 2017 | |
| Estonia | 27 | 2017 | Madagascar | 14 | 2016 | |
| Hong Kong | 27 | 2017 | Argentina | 14 | 2017 | |
| Russia | 27 | 2017 | Costa Rica | 14 | 2017 | |
| Kuwait | 26 | 2016 | El Salvador | 14 | 2017 | |
| Panama | 26 | 2016 | Guatemala | 14 | 2017 | |
| Cabo Verde | 26 | 2017 | Benin | 13 | 2016 | |
| Iceland | 26 | 2017 | Rwanda | 13 | 2017 | |
| Mongolia | 26 | 2017 | Sudan | 13 | 2017 | |
| Slovenia | 26 | 2017 | United Kingdom | 13 | 2017 | |
| Belgium | 25 | 2017 | Iraq | 12 | 2016 | |
| Bhutan | 25 | 2017 | Cyprus | 12 | 2017 | |
| Ecuador | 25 | 2017 | Democratic Republic of the Congo | 11 | 2016 | |
| Hungary | 25 | 2017 | Egypt | 11 | 2017 | |
| Turkey | 25 | 2017 | Palestinian | 11 | 2017 | |
| Bahrain | 24 | 2016 | Greece | 10 | 2017 | |
| Israel | 24 | 2016 | Jordan | 10 | 2017 | |
| Kazakhstan | 24 | 2016 | Kenya | 10 | 2017 | |
| Tanzania | 24 | 2016 | Malawi | 10 | 2017 | |
| Croatia | 24 | 2017 | Mauritius | 10 | 2017 | |
| Luxembourg | 24 | 2017 | Montenegro | 10 | 2017 | |
| Nicaragua | 24 | 2017 | Tunisia | 9 | 2016 | |
| Vietnam | 24 | 2017 | Guinea-Bissau | 8 | 2016 | |
| Bahamas | 23 | 2016 | Ghana | 7 | 2017 | |
| Finland | 23 | 2017 | Lebanon | 6 | 2016 | |
| France | 23 | 2017 | South Sudan | 6 | 2016 | |
| Georgia | 23 | 2017 | Belize | 6 | 2017 | |
| Kosovo | 23 | 2017 | Mozambique | 5 | 2017 | |
| Mexico | 23 | 2017 | Angola | 3 | 2016 | |
| Spain | 23 | 2017 | Zimbabwe | -1 | 2016 | |
| Djibouti | 22 | 2016 | Burundi | -2 | 2016 | |
| Lesotho | 22 | 2016 | Guinea | -6 | 2016 | |
| Australia | 22 | 2017 | Sierra Leone | -13 | 2016 |
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